We are all focused on product speed. Quick, quick, quick design the product, market the product, sell the product and then count the profits! Why so fast? Is it not better to take the time to do it best? Slowing down is not all bad. Taking the time to design the product best for its target market can create a product that can survive profitably for decades.
No matter what the price point, every product needs to be the best design for its function in the target market. It is not difficult to understand. Will your target customer buy the second best? Why not be best in market?
I think we can all agree, Apple is a very successful company? And they take great care in designing their products. They are not working for a price point, they are focused on delivering products that delight the user, and build loyal devotees as a result. If it delights, sales and profits follow.
Where do you want to take your brand? Please do not fall back on the excuse you cannot change. You can get better.
If you want to play the price game, do so at your own peril. In the end, only one, or maybe two, companies will win. Is that a good bet?
Aren’t you curious of what will happen if you do take the extra time to do it best?
We are in the midst of the largest retail shakeup in history. To put the DPH showroom performance in perspective, Coresight Research notes in its November 15 update, “US retailers have announced 9,052 store closures and 3,956 store openings.” Having just returned from the annual DPHA conference, I can tell you that the overall feeling is that business is good and will remain that way for the next 18 months. While this is not a statistic, deeply researched or confirmed, it has been a good indicator for years. I would like to congratulate all DPH showrooms for continuing to run ahead of the brick and mortar pack. Let’s make sure we stay ahead.
Think back to the time before the term “customer experience” was used to evaluate everything from Jiffy Lube to Hermes. As the industry began to pull itself out of the muck of the recession, the term “product value” was all the rage. Its catch phrase was: “Is that a good value for my money?” Customers were looking for value – the best products for their dollars, not low price.
As the industry became skilled on the “value” sales conversation, that term slipped into the background and “customer experience” emerged as the overall, undefinable, defining metric. Repeatedly we read and have been told that, “All great businesses offer a top-notch customer experience.” We see it referred to in case study after case study but, as with “value,” the challenge is to define and measure great customer experiences.
Angel investor Darren Herman offers guidance in his blog, Operating Partner. He proposed the following simple formula:
Value = Experience / Price
On first thought, that formula appears to be too simple, when you evaluate the equation in more detail, it makes sense. The kicker is defining experience. Price is simple: the lower it goes, the lower the experience factor can be to still deliver attractive value. But, if you are playing on the luxury-premium level, you have to improve the experience to justify higher pricing.
It has been proven continuously that the lowering price value strategy is a never-ending race to the bottom and that’s not a successful formula for DPH luxury experiences. The decorative plumbing and hardware industry can deliver on its value paradigm by focusing on the following five touchpoints: Showroom, Website, Salespeople, Customer Service and Vendors.
Breaking them down into easily defined deliverables allows you to create a manageable list to use as a brand experience evaluation scorecard (equally applicable to Manufacturers, Representatives and Showrooms).
Is your website easy to use and comfortable for your customers to shop?
Does your website offer the information your customers require?
Is your website easy for Google to find?
Are your key vendors’ presentations and product pages up to date?
Is your website respected more than your competition’s?
For e-commerce sites, does your showroom’s in-stock inventory cater to the products your customers really need before the vendor can deliver?
Side Note: Today’s customer wants to do their work whenever and wherever they are. To have a poor website is interpreted as you are not interested in their business. An effective and easy-to-use website is a must have.
Are your salespeople more knowledgeable and respected than your competition?
Are they consistent from customer to customer?
Do they listen actively?
Do they want to improve?
Side Note: Every time I am at a showroom or attending a conference the number one problem our colleagues mention is finding good people. Yet, few companies offer any type of sales training to make their good people better. I have never met a salesperson that cannot get better and that includes me.
Do you offer uncompromising cradle-to-grave service?
Do you proactively communicate both good and bad information with your clients as their job progresses?
Do you reach out to the client and end users after the job is finished?
Is your product return process painful for the client? Are they presumed guilty before being proven innocent?
Side Note: A significant factor in the continuing growth of showrooms and vendors is based on selling more to good customers. Will that hold true if you continue to offer the least?
Are they what they say they are?
Do they train and keep your purchasing, sales and customer service teams up to date?
Do they design and craft products in line with their pricing?
Do they deliver on what they promise?
Are their demands in line with their value to your business?
Side Note: Vendors, when was the last time you surveyed the key 100 showroom salespeople about what they think will help your brand improve? When was the last time you and your distributor showroom surveyed their good builder and trade customers about what they think will help your brand improve? Sitting in your office listening to a few loud folks is not the best way to build your brand’s foundation.
Is your showroom easy and comfortable for your customers to shop?
Is your showroom easy to use by your salespeople?
Is your showroom perceived as stylish by your core design trade customers?
Are your key vendors’ displays up to date?
Does your showroom’s inventory contain the products your customers need before the vendor can deliver?
Side Note: Maintaining a showroom is hard work and expensive, but when done effectively is can be very profitable. The more vendors, representatives and distributor showrooms stay in step, the better for all parties involved.
This list provides a tool to evaluate your business and to determine your customer experience rating. Each point can be valued good or bad or with a five-point scale. Determine which metric works best for your business and team.
There is one other factor to consider. Each point on the list focuses on eliminating FRICTION your customers encounter when working with your company. Both trade customers and end-users HATE friction. Removing friction requires an investment of money and time. Willingly taking back a polished nickel lavatory faucet that looks as if it was attacked by a steel grill brush is not easy or cheap, but necessary.
Do not lose sight of the fact that you are working to increase your customers’ perceived value of your business.
The bottom line is that each individual customer will evaluate your business. Having a metric to determine how your business is perceived will improve your customers’ experiences and help you develop effective strategies to address weaknesses.
Why would anyone purchase anything at list price? Today’s marketers continually believe the best way to move merchandise is to put it on sale. Stories no longer seem to be thought viable. And we all thought Amazon was to blame for the price dropping game.
Every marketer knows that email remains a powerful tool to build brand awareness and the email’s subject line is your brand’s calling card. Do you really want it to be all about how much today’s discount is? Can your brand only motivate people to open your marketing emails by shouting your products are marked down?
So after a consistent barrage of XX% off and free freight on any purchase, do you really think people are going to look at your brand as anything but a discount brand? Even powerhouse home brands such as Restoration Hardware and Williams Sonoma seem to run 50% off sales every other day. Why do I want to buy something that no one else wants?
Then think of the poor salespeople in the brick and mortar showroom. The first thing they must do every day is check to see what is on sale today. It is just like working in a supermarket and we all know how low their margins are. It is not sustainable.
As long as sales volume and product turnover remains high, these companies can get away with thinning profit margins but when a slowdown comes and sales drop 5%, that low, discounted margin might not be able to cover overhead and viola, losses appear. Then what happens? The markdown habit a brand gets into in good times are nearly impossible to break in bad times. Quarter to quarter planning is not a good play in the long game.
Let’s think about walking into a showroom, a purchasing office or an interior designer’s studio during the holiday season. What do you see? There are large and small Christmas trees, twinkly lights, cookies and candy galore, tall rectangular lavishly wrapped booze boxes and holiday cards by the score. Lots of people exchanging numerous gifts, thanking their customers for a great year and others trying to be remembered in the New Year. So many companies and individuals trying to make an impression. So what happens to all of those gifts?
The business holiday season is a traffic jam of companies trying to be remembered by old accounts or impress new ones. Is this where you want to spend your marketing money? Hoping that Johnny at ABC will recall yet another logo coffee cup that will motivate him to lead his next customer to your display? How many gifts will Johnny receive? Will yours be the one that is magically remembered? It is a big HOPE. But you don’t want to be that company that plays Scrooge and does nothing.
I would like to offer an alternative solution for holiday brand building.
I always tried to find a solid charity that offered a holiday card where we could place a picture of our complete team on the cover wishing Happy Holidays. The money went to a good cause and when anyone asked a team member, they had a good holiday story to share and show where they are in the card cover image.
Doing this freed our holiday marketing money to use during a time when it made a more substantial impression. By mid-January, a lot of people are back in the day-to-day workflow and miss the “entertainment validation” of the holidays. This is a good time to take a target to dinner, bring in a catered lunch or hand out gift cards. By waiting until the January holiday hangover, you will be the lone brand thanking key players and it just might wash away the gift they received from your competitor way back in December. Some companies that follow this plan have a large event in early spring to welcome the building season and rev everyone up.
This plan also removes the stress of trying to do the best thing for your clients and allows you to better focus on your family’s holiday festivities. Because isn’t that what the holidays are all about?
P.S. Let’s never forget that HOPE is not a strategy.
This article previously appeared in the November 22 issue of DPHA’s Connections
Remember the old joke, “Oh, I buy Playboy for the articles…” It was always good for a laugh and some bright blushing faces. Today, that line translates to “I skim Instagram for the comments…” ha, ha, giggle, giggle snort… But let’s think about that. Is it all about the image or is it about recognizing what the image stands for? Is it just a slick shot or is it about the authenticity of the brand and its story supporting the image? Can marketing and branding survive on images alone?
One of our nation’s biggest fear is countries outside our borders influencing our elections. Posting stories to Facebook crafted to motivate certain-minded people to do what is best for that outside organization. They build a story on what their targeted audience WANTS and THINKS and leverage it, correct? Sounds like branding to me. Sounds like people do take the time to read and recall the post.
Lazy marketing is simply focusing on pretty pictures but without an authentic, captivating story it is just that- a collection of colors. With substance, images and videos that go viral lose steam at the store once the flash burns out.
You have worked hard to build your brand and your good customers appreciate that. Don’t lunge for the quick hit. Set your goals, formulate your strategy leveraging your brand’s strengths. Then craft engaging stories and images that will stop your customers mid-swipe.